House of Commons · Written Ministerial Statement
Room to Run Guarantee
25 April 2022 · Foreign, Commonwealth and Development Office
Proposed by Vicky Ford Con Chelmsford
Summarised by AI from the official record, so it can contain mistakes.
At a glance
Key points
- The Foreign, Commonwealth and Development Office is proposing a US$1.6 billion guarantee to support the African Development Bank's lending capacity.
- The guarantee aims to address climate financing needs and the economic impact of the pandemic on the AfDB's ability to lend.
- MPs have 14 parliamentary sitting days to object to the proposal, after which HM Treasury's approval will be final.
Issue summary
The statement addresses the creation of a new contingent liability for the Room to Run Guarantee by the Foreign, Commonwealth and Development Office (FCDO) to support African Development Bank (AfDB) loans.
Action requested
The FCDO is proposing to undertake a US$1.6 billion guarantee to allow the AfDB to increase its lending capacity in Africa, addressing both climate financing needs and the economic impact of the pandemic on AfDB's ability to lend. HM Treasury has approved this proposal, but final approval will be withheld if any MP objects within 14 parliamentary sitting days.
Key facts
- The Room to Run Guarantee is for US$1.6 billion (£1.23 billion).
- It aims to meet Africa’s clean and green development needs estimated at $3 trillion over the next decade.
- The liability will last up to 15 years, with FCDO only paying Official Development Assistance if a default occurs after ATI first loss cover is exhausted.
- HM Treasury has approved this proposal.